Paul L. Caron
Dean


Friday, April 17, 2015

House Votes To Repeal Estate Tax, Preserve Step-Up In Basis At Death

Estate Tax LogoFollowing up on Monday's post, the House voted 240-179 yesterday to repeal the estate tax and preserve step-up in basis at death:

https://taxprof.typepad.com/taxprof_blog/2015/04/house-votes-to-repeal-estate-tax.html

Congressional News, Tax | Permalink

Comments

This is nice at the federal level but many of us are not really affected by it. In my case it is the NJ tax which is not in sync with the Feds that will cause me harm.

Posted by: Rich | Apr 17, 2015 8:40:44 AM

Back in the late 1990s, the Tax Section's quarterly journal ran an article on a comparative study of death tax regimes across the developed countries. It found that the U.S. death tax system was by a wide margin the most onerous. It also quoted the data points that the federal estate tax brought in less than 1% of gross federal revenue, and something like 65% of its revenues were consumed in direct administration and enforcement costs. In other words, it never left the IRS building, so to speak. I can't lay hands on that article now, but I'd be fascinated to see current data on gross-revenue-versus-enforcement/administration figures.

Posted by: Countrylawywer | Apr 17, 2015 9:40:51 AM

What is objectionable is the lifetime scrutiny of every gift and the final balance sheet at death by the central government. We should be free to give as we please without some final accounting to the State. We are not serfs. The property is or should be ours. Who supports the gift tax besides the class warriors obviously and predictably under the headlines above? Insurance companies who sell funding opportunities for the liabilities created, and their shareholders.

Posted by: jamesb.bkk | Apr 17, 2015 9:54:01 AM

This isn't only about "rich people." It's about family farmers who have a lot of paper wealth in land--farmland prices are sky high right now--but no actual money in the bank.

Posted by: Jim | Apr 17, 2015 10:13:51 AM

Jim, well, then git rid of the basis step up if you do away with the estate tax! Sounds like this House bill would be a giant give away to farmers if you ask me. The next generation of "family farmers" (if that's even a big thing anymore) will find it all too easy to sell their inherited land without any tax consequences. I actually think the federal estate tax isn't actually as onerous as people say it is.

Posted by: HTA | Apr 20, 2015 3:00:16 PM

Why is the family farmer the whipping boy for the estate tax repealers? Any time the estate tax is brought up we are browbeaten with the plight of the family farmer. Seems to me that if we cared so much about the farmers, outside of subsidizing their crop growing/not-growing, we could tailor legislation to exempt certain classified acreage from the estate tax while keeping the estate tax in place. Why throw the baby out with the bathwater just because some mythical family might lose some acreage?

Posted by: Daniel | Apr 21, 2015 5:27:20 AM

"Jim, well, then git rid of the basis step up if you do away with the estate tax!"

I'm good with this. I suspect the step up in basis costs the Treasury more than the estate tax brings in.

Posted by: Dale Spradling | Apr 21, 2015 6:30:23 AM

Pump the brakes Dale. Can we wait for my family to pass before taking such measures? :)

Posted by: Daniel | Apr 21, 2015 10:50:31 AM